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Concierge medicine is one model a private practice physician should consider if finances become tight.
There's been a major shift in healthcare in recent years, with fewer and fewer physicians owning private practices. The pressure from ever-increasing mandates and the negotiating power of large delivery systems have driven this change.
For physicians, private practice is professionally rewarding. They have full control of their practice, their schedule, the people they hire, and perhaps most importantly-the time they spend with their patients. But, private practice can be economically challenging. It's now almost impossible for a physician to start a private practice relying solely on reimbursements from insurance plans. Private practitioners simply do not have the negotiating power of a large delivery system, and the lower reimbursements they earn force them onto a gerbil wheel of volume care that cannot be sustained.
Some private physicians are hoping to find success by bucking third party payers, and going right to the source for their reimbursements-their patients. With no need to worry about paperwork and reimbursements, cash-only practices may seem like an attractive option, but in reality, they can be quite risky and for most physicians, won't work. The demographics have to be just right in order to find enough patients willing to forgo their plans and government programs for care.
Direct pay membership practices are another new private practice model. Unfortunately, physicians in these types of practices find their annual revenue plummeting. In their 2016 annual report, The DPC Journal reported more than 80% of physicians practicing DPC did not earn enough to support themselves. It's very risky to expect a large group of patients to pay monthly for unlimited care they likely don't need and won't use.
But there is a way for a physician to bridge the gap-a professionally rewarding private practice that is also economically viable.
Concierge medicine has worked for private physicians across the country for more than 12 years, and continues to grow. In a concierge model, the physician continues to accept government plans and insurance programs for visits, but charges patients an annual membership fee, which they pay directly.
Concierge medicine started out as a full membership model in upper-class neighborhoods, but things have since changed. The model has been adapted and tailored by private physicians to suit many different demographics, practice goals and styles-from solo practitioners in primary care who are looking to buffer the effects of declining reimbursements-to specialists, who are finding their practices squeezed financially.
In particular, hybrid models of concierge care are growing. These models are well-suited to the private physician who wants to continue to see all patients, including Medicare patients, but needs a new, private revenue stream. The physician offers patients the option of joining a concierge program for enhanced service and convenience, or remaining in the traditional practice. Typically, between five and 10 percent of the patients opt to join the hybrid concierge program. That membership alone can boost revenue for a private practice-making it much easier to remain independent.
A private physician with a patient panel of about 1,800 can see their revenue increase by over $100k each year in hybrid concierge. And, when launched properly, there is no risk. Since patients are not dismissed, plans are not dropped and referral networks remain intact, the model can only improve a practice's bottom line. Plus, hybrid models align with government mandates like MACRA and QPP.
The important thing for physicians interested in private medicine to remember is, you don't have to go it alone, treading water. Patients are feeling the pressure too, and they want an ongoing, trusted relationship with their physician, and in many cases, they are willing to pay for it. The continuing constraints being put on large health systems, along with the de-personalization of medicine, make the rebirth of private care inevitable. Private practice under a hybrid concierge model is an ideal solution to help providers capitalize on a changing market.